Mr. Speaker, the budget is a document that is both nuanced and comprehensive. It implements many election promises that, taken together, constitute the economic vision that the Liberal Party laid out during the election campaign and that earned the confidence of Canadians on October 19.
In fact, the budget plays a dual role. It focuses on the immediate needs of today's economy, as well as the challenges that we must address in the longer term if we want to make a better future for our children and our grandchildren.
The budget addresses the needs of our times, this economic period where growth has been slow for far too long. It addresses the increasingly pressing need to lay the foundation to increase the longer-term productivity of our Canadian industries. Without that, we will not really be able to support and encourage the strong growth we need in the coming years to create the necessary tax revenue for funding the social programs that are so dear to us and are often at the very heart of our Canadian identity.
In addition to the temporal aspect of the budget, there is the fact that it is multifaceted because of an insightful and wise acknowledgement that the economy is complex and composed of diverse and related elements and that we must act on different fronts simultaneously to create the growth that will allow each and every one of us to prosper with dignity and to have a good quality of life.
The budget recognizes, for example, that we must look after the economy and the environment at the same time. We have to ensure that our businesses are healthy and also protect the well-being of our children. We need major infrastructure, such as efficient public transit networks, but also meeting places where people can get together for socialization and recreation and to talk to, support, and help one another.
We have to innovate with new technologies and products brought to market, but we must also provide our university researchers with the means to explore these concepts that are sometimes still in the early stages and whose practical application and economic viability are still unknown.
In short, its comprehensive vision truly makes this a Liberal budget.
There has been much talk about the deficit. No one really wants deficits as a matter of ideology, at least not on this side of the House. In fact, as Liberals, we have been in the past elected to wrestle deficits to the ground.
However, there is a time when deficits are helpful on a short-term basis to stabilize the economy, build the confidence of consumers, businesses and investors and sow the seeds of future growth, and Canadians have determined that this time is now.
The need to invest in Canada's future, even at the cost of modest deficits, was not only endorsed by Canadians in the last election. The idea is reverberating in other developed nations as they come to realize that monetary policy has come up against its limitations, and cannot by itself move the economy out of its current doldrums.
No lesser a Canadian business leader than Michael Sabia, hardly a promoter of socialist economic fantasies, has said that it is time “to focus on the real economy”, as opposed to the monetary economy only.
Bank of Canada Governor Stephen Poloz has recently said that he is putting off further monetary easing, namely through further interest rate cuts, until he evaluates the extent of the fiscal stimulus coming from the federal government.
David Watt, chief economist at HSBC Canada, as per an article in The Globe and Mail of March 12, said:
What we need is more of a change in perception of where we want the economy to go and set the stage for not just government, but for the private sector to start creating jobs...The private sector doesn’t have confidence to start adding jobs and that’s what we need.
What he is saying is that the previous government after 10 years did not create that confidence.
This budget, both subtle in design and forward-looking and comprehensive in scope, will achieve dual results. It will create jobs in the short term by investing in projects to renew Canada's social, green, and public transit infrastructures and it will also spur confidence in the future by acting today to create the conditions needed to support growth in the years ahead.
According to The Economist in its February 20 issue:
The good news is that...Plenty of policies are left, and all can pack a punch. The bad news is that central banks will need help from governments. Until now, central bankers have had to do the heavy lifting because politicians have been...reluctant to share the burden. At least some of them have failed to grasp the need to have fiscal and monetary policy operating in concert. Indeed, many governments actively worked against monetary stimulus by embracing austerity.
I would add that the previous government was repeatedly criticized specifically for pursuing an inherently self-contradictory economic policy.
The Economist goes on to say:
Bond markets and rating agencies will look more kindly on the increase in public debt if there are fresh and productive assets on the other side of the balance sheet. Above all, such assets should involve infrastructure...
In line with this prediction by one of the world's most reputable publications read by leaders and finance ministers around the world, on March 30 The Globe and Mail ran the following heading, “Investors, rating agencies see Liberal deficit plan as manageable”.
The Conservatives believe in markets and market signals. They sometimes even elevate markets to the status of religion and attribute magical powers to markets to solve a whole range of problems that are not necessarily economic in nature.
The financial markets are speaking to the Conservatives right now. Moody's Investors Service's vice-president Steven Hess has said that the deficit is not large as a share of the economy and that the federal debt-to-GDP ratio is low by international standards.
David Madani of Capital Economics has said, “the market’s 'shrug' is hardly a surprise because the risk that the budget’s projected deficits would trigger a surge in Ottawa’s borrowing costs 'is practically zero'.”
To the foregoing I would reference another headline in The Globe and Mail, on March 3, “Big banks urge Ottawa to spend $20-billion in rapid stimulus”.
This is a finely designed budget that focuses on real problems. That is what Canadians wanted and that is what Canadians were expecting.
One of my policy interests is water. I am proud to say that for the first time in as long as I can remember in this House a budget is giving a specific priority to water namely, water filtration and waste water infrastructure. As announced in the budget, there will be $5 billion for green infrastructure of which a large amount will be for water and waste water infrastructure.
Water is becoming a greater priority for Canadians not only because of the impact of climate change on water supplies, but because Canadians are becoming more concerned with the quality of the water in their ecosystem. We have seen this repeatedly with a number of issues. This budget takes a step in the right direction in making water a priority of public policy at the federal level.
The budget is a step in the right direction. There will be more to come in the years to come throughout this mandate. This Liberal government acted quickly to implement a good number of the promises that were discussed in the election campaign and that Canadians resoundingly supported.